OTCPK:TMXX.F

Stock Analysis Report

Executive Summary

TMX Group Limited operates exchanges, markets, and clearinghouses primarily for capital markets in Canada and internationally.


Snowflake Analysis

Second-rate dividend payer and slightly overvalued.


Similar Companies

Share Price & News

How has TMX Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TMXX.F has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-4.1%

TMXX.F

-8.6%

US Capital Markets

-10.6%

US Market


1 Year Return

33.6%

TMXX.F

4.9%

US Capital Markets

5.2%

US Market

Return vs Industry: TMXX.F exceeded the US Capital Markets industry which returned 8.9% over the past year.

Return vs Market: TMXX.F exceeded the US Market which returned 10.2% over the past year.


Shareholder returns

TMXX.FIndustryMarket
7 Day-4.1%-8.6%-10.6%
30 Day-6.3%-7.9%-8.5%
90 Dayn/a-4.4%-4.6%
1 Year37.8%33.6%7.1%4.9%7.4%5.2%
3 Year71.0%57.6%25.5%18.4%31.7%23.2%
5 Year132.2%100.8%65.9%50.7%56.4%39.3%

Price Volatility Vs. Market

How volatile is TMX Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is TMX Group undervalued compared to its fair value and its price relative to the market?

25.49x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: TMXX.F ($88.28) is trading above our estimate of fair value ($78.47)

Significantly Below Fair Value: TMXX.F is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: TMXX.F is good value based on its PE Ratio (25.9x) compared to the Capital Markets industry average (31.8x).

PE vs Market: TMXX.F is poor value based on its PE Ratio (25.9x) compared to the US market (17.1x).


Price to Earnings Growth Ratio

PEG Ratio: TMXX.F is poor value based on its PEG Ratio (2.5x)


Price to Book Ratio

PB vs Industry: TMXX.F is good value based on its PB Ratio (1.8x) compared to the US Capital Markets industry average (6.6x).


Next Steps

Future Growth

How is TMX Group forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

10.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TMXX.F's forecast earnings growth (10.4% per year) is above the savings rate (1.7%).

Earnings vs Market: TMXX.F's earnings (10.4% per year) are forecast to grow slower than the US market (13.2% per year).

High Growth Earnings: TMXX.F's earnings are forecast to grow, but not significantly.

Revenue vs Market: TMXX.F's revenue is expected to decline over the next 3 years (-10.4% per year).

High Growth Revenue: TMXX.F's revenue is forecast to decline over the next 3 years (-10.4% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TMXX.F's Return on Equity is forecast to be low in 3 years time (8.5%).


Next Steps

Past Performance

How has TMX Group performed over the past 5 years?

30.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TMXX.F has high quality earnings.

Growing Profit Margin: TMXX.F's current net profit margins (21.3%) are lower than last year (27.8%).


Past Earnings Growth Analysis

Earnings Trend: TMXX.F's earnings have grown significantly by 30.9% per year over the past 5 years.

Accelerating Growth: TMXX.F's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TMXX.F had negative earnings growth (-13.4%) over the past year, making it difficult to compare to the Capital Markets industry average (8.4%).


Return on Equity

High ROE: TMXX.F's Return on Equity (7.1%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is TMX Group's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: TMXX.F has a low level of unsold assets or inventory.

Debt Coverage by Assets: TMXX.F's debt is covered by short term assets (assets are 27.2x debt).


Financial Institutions Analysis

Asset Level: TMXX.F's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if TMXX.F has a sufficient allowance for bad loans.

Low Risk Liabilities: TMXX.F reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if TMXX.F has an acceptable proportion of non-loan assets held.

Low Risk Deposits: TMXX.F has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if TMXX.F has an appropriate level of bad loans.


Next Steps

Dividend

What is TMX Group's current dividend yield, its reliability and sustainability?

2.34%

Current Dividend Yield


Dividend Yield vs Market

company2.3%marketbottom25%1.6%markettop25%4.1%industryaverage2.1%forecastin3Years2.5%

Current dividend yield vs market & industry

Notable Dividend: TMXX.F's dividend (2.31%) is higher than the bottom 25% of dividend payers in the US market (1.53%).

High Dividend: TMXX.F's dividend (2.31%) is low compared to the top 25% of dividend payers in the US market (3.96%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, TMXX.F has been paying a dividend for less than 10 years.

Growing Dividend: TMXX.F's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (57%), TMXX.F's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TMXX.F's dividends in 3 years are forecast to be covered by earnings (50.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.0yrs

Average management tenure


CEO

John McKenzie 0

CA$1,648,678

Compensation

Mr. John McKenzie has been the Chief Financial Officer of TMX Group Limited since July 11, 2016 and serves as its Senior Vice President and Interim Chief Executive Officer. Mr. McKenzie served as Vice Pres ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD1.24M) is below average for companies of similar size in the US market ($USD6.51M).

Compensation vs Earnings: John's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
John McKenzie
Senior VP0yrsCA$1.65m0.0048% CA$227.1k
Jayakumar Rajarathinam
President of CDCC & CDS and Chief Technology & Operations Officer1.7yrsCA$1.87m0.0014% CA$67.8k
Cheryl Graden
Sr. VP, Group Head-Legal & Business Affairs4.9yrsCA$1.02m0.00040% CA$19.0k
Luc Fortin
President and CEO of the Montréal Exchange (MX) & Global Head of Trading2.1yrsCA$1.19m0.00041% CA$19.4k
Frank Di Liso
Vice President of Corporate Finance and Administration0yrsno datano data
Paul Malcolmson
Director of Investor Relations0yrsno datano data
Alison Simpson
Senior Vice President of Marketing and Branding3yrsno datano data
Sanjay Kulkarni
Chief Marketing Officer & Head of Digital Solutions1.3yrsno datano data
Mary Hukezalie
Senior VP & Group Head of Human Resources8.1yrsno data0.0077% CA$363.7k
Shaun McIver
Chief Client Officer3.8yrsno data0.0050% CA$239.5k

3.0yrs

Average Tenure

Experienced Management: TMXX.F's management team is considered experienced (3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Harry Jaako
Independent Director7.6yrsCA$135.00kno data
Geraldine Sinclair
Independent Director7.6yrsCA$136.00kno data
William Linton
Independent Director7.6yrsCA$202.00kno data
Charles Winograd
Chairman of the Board7.6yrsCA$300.00kno data
Marie Giguére
Corporate Director8.8yrsCA$146.50k0.0036% CA$168.8k
Jean Martel
Corporate Director7.6yrsCA$136.00k0.00030% CA$14.2k
Kevin Sullivan
Director7.6yrsCA$120.50kno data
Luc Bertrand
Director8.8yrsCA$55.50k1.05% CA$49.7m
Eric Wetlaufer
Corporate Director7.6yrsCA$141.00kno data
David Wood
Chairman of the Canadian Depository for Securities Limited10.1yrsno datano data

7.6yrs

Average Tenure

66yo

Average Age

Experienced Board: TMXX.F's board of directors are considered experienced (7.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

TMX Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: TMX Group Limited
  • Ticker: TMXX.F
  • Exchange: OTCPK
  • Founded: 2011
  • Industry: Financial Exchanges and Data
  • Sector: Diversified Financials
  • Market Cap: CA$6.336b
  • Listing Market Cap: CA$4.742b
  • Shares outstanding: 56.26m
  • Website: https://www.tmx.com

Number of Employees


Location

  • TMX Group Limited
  • 300-100 Adelaide Street West
  • Toronto
  • Ontario
  • M5H 1S3
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
XTSX (The Toronto Stock Exchange)YesCommon SharesCACADSep 2012
9TXDB (Deutsche Boerse AG)YesCommon SharesDEEURSep 2012
TMXX.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDSep 2012

Biography

TMX Group Limited operates exchanges, markets, and clearinghouses primarily for capital markets in Canada and internationally. The company operates through four segments: Global Solutions, Insights & Analytics; Capital Formation; Derivatives Trading & Clearing; and Equities and Fixed Income Trading and Clearing. The Global Solutions, Insights & Analytics segment delivers integrated data sets to fuel proprietary and third party analytics for trading and investment decisions. The Capital Formation segment facilitates capital raising for issuers for the development and access to alternative source of capital. The Derivatives Trading & Clearing segment trades in interest rate, index, and equity derivatives. The Equities and Fixed Income Trading and Clearing segment engages in the provision of equities and fixed income trading, clearing, settlement, and depository services. The company was formerly known as Maple Group Acquisition Corporation and changed its name to TMX Group Limited in August 2012. TMX Group Limited was incorporated in 2011 and is based in Toronto, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/28 01:20
End of Day Share Price2020/02/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.